According to a 2022 Consumer Financial Protection Bureau report, 58% of all third-party debt collection is made up of medical debt. Maintaining best practices for resolving accounts can lead to a positive and supportive experience for consumers, and effective management of debt accounts for healthcare providers.
In 2014, the Healthcare Financial Management Association (HFMA) released a best practices report with information about pre-service communications and post-discharge resolution tips that can help keep consumers informed and current with medical bills. The report was updated in 2020. In this post, we'll cover some of those best practices.
Effective financial communication and patient financial education starts before the medical procedure begins. Some of the suggestions offered in the report include:
More information about communication best practices can be found here.
Provider collection policies provide a roadmap for the provider billing team and the patients. Every provider should have clear, easy to understand collection policies.
Vendors and partners that are involved in account resolution must operate under contract with your organization. Make sure they are acting in accordance with policies determined by the hospital or medical facility's board or governing body. This includes:
Any accounts that are sent to collections must follow the board-approved collections processes. Any extraordinary collection actions (ECAs) such as lawsuits, liens, wage garnishment should be used with discretion, and your third-party representative should be aware of your policies. The negative impact to consumers should always be taken into consideration.
Ultimately, medical debt management is a complicated topic. By following well-established policies, providing patient education prior to medical procedures, and by using ECAs sparingly, medical debt collection can be a positive experience on both sides.
Since 1966, Credit Management Company (CMC) has provided full-service accounts receivable and collection management programs across several industry segments, including healthcare. With customized programs available, we can help your healthcare facility resolve medical accounts effectively and efficiently. Contact us today for more information.